updated 10:47 am EDT, Wed July 30, 2014
Financial results promising for Sprint, subscriber losses continue
Sprint has managed to return to profitability in its latest quarterly financial results, after earning a net income of $23 million for the period, something the carrier claims is the best performance in "almost seven years." Despite the financial success, the carrier is continuing from the last quarter's 595,000 customer reduction, with the further net loss of 220,000 customers.
The consolidated operating income is also up for the carrier, extending the previous quarter's $420 million income to $519 million, again its highest for the last seven years, and in stark contrast to the 874 million consolidated operating loss for the same period last year. Net operating revenues for the quarter rests at $8.8 billion, marginally down from $8.9 billion from the previous quarter and the same year-on-year figure.
Sprint lost a total of 181,000 postpaid customers in the period, along with 542,000 prepaid, though the 503,000 increase of wholesale and affiliate customers bought the net customer loss up to the 220,000 figure. At the end of the period, Sprint counts a total of approximately 29.7 million postpaid subscribers, 14.7 million prepaid, and 8.9 million wholesale customers, giving it a total customer base of 53.3 million users.
CEO Dan Hesse partly blames its network maintenance for the loss of customers, despite expanding its LTE service to 254 million people and enabling HD Voice nationally. "Our complete network replacement impacted the network experience, so we lost customers last quarter," said Hesse, before inviting potential customers to try the Sprint Satisfaction Guarantee, which offers a refund of the device cost and waiving of service and activation charges within the first 30 days of commitment. Sprint Spark, the company's multi-spectrum initiative, is now available in 27 markets, with the company offering 22 devices capable of taking advantage of the extra bandwidth.
During the quarter, Sprint managed to sell 988,000 devices at retail and 4.2 million via wholesale and affiliates, bringing the total up to 5.2 million. While the period is higher than the previous quarter and the same period last year, with 4.8 million and 3.9 million respectively, Sprint did not break down how many of these sales were for smartphones, tablets, or other devices.
While the results are relatively positive for Sprint, considering its earlier financial situation, it is unlikely to affect the rumored $32 billion acquisition of T-Mobile.